How much does prior experience matter for CEOs and senior managers?

From an HBR interview with Prof. Gautam Mukunda:

Mukunda: I was surprised by how unambiguous the data were, but they confirmed what I suspected: If you choose an insider who you know can do the job well, most of the time that person won’t perform any differently from any other top candidate with lots of experience. Such insiders—I call them “filtered leaders”—might be good, but they probably won’t be brilliant. It’s the unfiltered leaders, the outsiders without lots of experience, who perform the very best.

HBR: So should firms always hire outsiders without experience?

Mukunda: No, because those people are also more likely to crash and burn. Though the best leaders—Steve Jobs, Abraham Lincoln—were unfiltered, the things that made them so effective, such as their ability to think differently and not feel beholden to a certain way of doing things, often lead to terrible results. Unfiltered leaders are high risk, high reward. Filtered leaders—like Tim Cook and Neville Chamberlain—have deep knowledge and can be very effective in a stable situation. But they often can’t adapt to extreme, sudden change or are unable to disrupt the status quo, which an outsider feels freer to do.

One thought on “How much does prior experience matter for CEOs and senior managers?

  1. Everybody talks about how passion is important for any business, but for me, it seems that passion is a rare quality in many good candidates. Eventually, you left with one of the few things that can be evaluated – and that is experience.

    Prof. Mukunda said that “Start-ups, where the most likely outcome is bankruptcy, and companies on the precipice are good situations for unfiltered leaders. But if you want to be in business in 50 years, pick a filtered leader”.

    I think that ״unfiltered״ leaders should be in any phase of a business life cycle. These kinds of leaders have the ability to take risks and do things differently, regardless of their experience and only because of one quality – their passion.

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